How to Give Your Monthly Budget a $1000 Haircut

TULANE & COAL SE--My next door neighbor has a bumper sticker on her car that reads, "Oh no...not another learning experience!" Well, Hello 2009! None of us can see into the future, but this much seems certain: some of us will lose our jobs, our cars, our houses, even our partners. So let's confront the dismal economic uncertainties that lie in wait before we get bushwacked by reality.

Here is an economic reality: you have more control over your spending than you do over your income. Here are a couple of ideas that can save you $1000 per month. Now I know that some of these ideas might be labeled 'extreme.' But better to look at them now with a critical eye and maybe some humor than to get all depressed about them later. And most of these ideas really won't change the quality of your life at all...except for the better.

Sell Your Second Car...Savings: $500
If your household has two vehicles and you need to cut back on your expenses, this is definitely the place to start. But maybe surprisingly, the biggest expense in owning a vehicle is not the cost of gasoline, it is depreciation. I know there are a lot of variables, but if you have a newer car it is probably depreciating at a rate of around $200 per month. Gas adds another $100 to $200...say $150. Insurance is another $100 or so. Periodic maintenance like oil changes, wiper blades, antifreeze, batteries, car washes, and hanging pine-scented air fresheners come to another $20. Savings for big ticket maintenance should also be included, maybe another 20 bucks. Parking meters, fees, and tickets could easily add $10...especially if you work downtown or go to UNM. All this comes to a whopping $500.00 per month!

Notice that this does not include the purchase price of the vehicle. Or theft or accidents that fall under your quite sizable insurance deductible.

I know. Will this work for everybody? Is Albuquerque's public transportation system adequate to make this work in your case? The short answer is: Probably, but you might have to move.

The Easy Stuff...Savings: $380

Only drink water with meals. I'm not saying drink nothing but water, just drink only water with your meals. I figure between eating out and at home this would probably save a household of two between $25 and $100 per week depending whether alcohol is involved. Even at $50 per week that comes to $200 in a month.
Cancel your Cable TV. My friend Bob Martin went back to using an antenna with his HDTV. He gets 39 channels. The digital system allows broadcasters to send more than one signal. KNME Channel 5, for instance, has 3 separate channels. The problem is that most of the 39 channels are religious, home shopping, or in Spanish but that is true of cable as well. Besides, when surfing, 39 channels is more than enough. It is 90% crap anyway. Cable TV costs $60.
Shop smarter for food. Organize your menus around sales items. Smith's has great meat sales. And who doesn't drink their 'Big K' sodas? Sunflower Market has a double ad day Wednesdays: They honor both last week's and this week's sales fliers the same day. And MaryAnn's son Ethan claims he saves 30% shopping for food at Walmart. If you can save $30 per week that makes $120 per month.

Rent the Right House...Savings $400
The savings here comes from doubling up, two people sharing housing and utility expenses. If you are a homeowner this may still be possible, but if you are a renter, the opportunities are here to make quite a nice life for yourself and save a bunch of money at the same time.

First of all, let me say that right now is not the time to be thinking of buying a house. The housing market is too unpredictable and you could lose your entire down payment in a year...possibly leaving you upside-down for a decade. Buying a house is only cheaper than renting when housing prices are going up. Otherwise it is a net loser until you have made a substantial dent in the principle and that takes about 20 years. Still, there are reasons to buy...the biggest one being that you want a dwelling in a specific location or of a specific nature, like a house with two master bedrooms. Sometimes you just have to act or never get what you want.

Renting out a room is not as scary as it may appear. Lots of people do it. But if your current house does not give two people enough privacy, consider moving. There are many, many houses that would easily accommodate two or three roommates. Lots of them are in the Nob Hill and University areas where extra room additions and mother-in-law quarters are pretty common.

The added benefit is that these areas are also near the RapidRide stations, which makes getting rid of your car much easier. We are actually in a good time to find a rental in the University ghetto as we are between semesters. Spring is even better. If you have a house with small apartment in back, this would rent for $450 to $500 including utilities. With a shared kitchen but otherwise a separate living area, the price drops to about $350 to $400.

You have to view getting a roommate as an opportunity to meet someone interesting. And if the house or apartment is in your name, any problems with the other person means that they are the one that has to leave. Even so, renting out a room is seen as a desperation move by some. I hope that by talking about it, the reader can look at it objectively and decide without feeling like it is the worst of all possible worlds.

Total Savings per Month: $1280
You can pick & choose among these ideas to arrive at saving $1000 per month. And there are many other ways to save money. If you have some tips please help us all out. The important thing is to look to the future with some sense of optimism and empowerment.

Post-Consumer America

I can think of no more insulting term than to be referred to as a "Consumer." Consuming is the opposite of contributing to a community. As such it is the philosophical and ethical dead-end of current times. When we were attacked on 911 G. W. Bush told us to go shopping. Where is the shared sense of purpose in that? We here on the Duke City Fix are fortunate enough to be called a community. It is in this spirit that we post and comment. It is in this spirit that we share our thoughts and feelings.

Here...have a cookie. And make sure you two hold hands while crossing the street.

Views: 41

Comment by once banned twice shy on January 6, 2009 at 2:35pm
Tricross: a person can dry their laundry outside in the winter here in NM. No need for a dryer at all. I know, that's a shocking thing to say--you should see the looks on people's faces when I tell them I have no machine for drying clothes. Of course, I give them the same look when they tell me they don't hang their clothes outside to dry...
Comment by ABQSkippy on January 6, 2009 at 2:40pm
I use my clothesline for much of the year. However, not in the winter. I don't want the laundry to smell like smoke.
Comment by Michelle Meaders on January 6, 2009 at 3:42pm
Carry your lunch to work, and don't go out for coffee! You'll be less likely to overeat, too. Use the time you save to go for a walk at lunch.
Comment by Michelle Meaders on January 6, 2009 at 3:48pm
"KNME Channel 5, for instance, has 3 separate channels." Yes, without cable you get them and 2 more: 5.1, the national feed; 5.2, the usual local programming, and 5.3, Ve-Me new programs in Spanish. We also get 9.1 and 9.2, more of the national programs. You can look on KNME's website to see what's on when.
You should also get 4.2, which is weather all the time.
Comment by Tricross on January 6, 2009 at 4:01pm
OBTS - what ABQSkippy says. Of course if smoky clothing doesn't matter, then no worries. It's just that when you vent the dryer into the house, you save on heating, get humidity and dry clothes all for one price!

@NMGolfHacker - Good job. We will have our home paid for in April. No credit cards, no car payments.
Comment by Adelita on January 6, 2009 at 4:25pm
My father always taught me that if you are going to buy a car you must pay cash. It takes a while to save the money, but not having a car payment is a blessing. He also taught me that if you have a credit card you have to pay it off in full every month. Well, that one was a much harder lesson to learn!! Now, I am almost completely debt free. It's been hard, but worth it.

NMGofHacker - Saving money!! What a concept! The best thing my father taught me was to have plenty of savings for the unexpected. Since I was just recently informed that I my job is being cut, I feel secure that I have enough money in the bank to carry me through for a while. And if any emergencies arise - I'm ready.

And another great money savings tip- trading! I trade quite frequently with my artist friends - their art for my jewelry. It's great! I've traded jewelry for haircuts, swamp cooler maintenance, etc.

Thanks for another great post Johnny!!!
Comment by Brendan on January 6, 2009 at 4:39pm
The rule from my CPA is: If you're going to carry any debt, make sure the interest is tax deductible. Mortgages and home equity loans are, cars and credit cards aren't.
Comment by JeSais on January 6, 2009 at 6:27pm
I think the number one savings tip for most us is to learn the difference between NEED and WANT.
I have to say, there's not much that I actually need: basic overhead (mortgage, gas, elec, internet), and food. Everything else is a luxury.
Comment by Pat O. on January 6, 2009 at 7:24pm
"Once banned twice shy"--another nitpick. If you boycott WalMart (or any other store), that store will lay off enough employees that their bottom line goes positive. In other words, you hurt the workers first, not the store or its owners. My daughter used to boycott WalMart until she realized that truth (a friend of hers got laid off).
Comment by Sarahjmd on January 6, 2009 at 8:51pm
We turned our lives into a home based job. We spend less, make less and keep more. We put less than 4000 miles a year on the road in our cars. We keep more of the money we make than we EVER did before. We kick ourselves for not thinking of this sooner. Turn your interest/hobby/passion into a job where YOU are in control. You can do it! I pay for my own health insurance and it is 100% tax deductable, as is most every thing else we have to food, electricity, natural gas, furniture, name it. I do NOT cheat on my taxes in any way shape or form. Yet we are living a higher standard of living than we even came close to when we both worked for somebody else and made way more. Have faith in yourself. What is your passion? Make it happen.


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